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releasing Equity

  • 13-04-2018 8:38am
    #1
    mellyw
    Registered Users, Registered Users 2 Posts: 2 ✭


    Hi just looking for advice. my mam and dad are in their 60s and own their home. They are wondering if their is any way of releasing equity from their house that does not have to be paid back until the house has been sold or when they pass??? any advice appreciated.


Comments

  • #2
    Liam D Ferguson
    Registered Users, Registered Users 2 Posts: 542 ✭✭✭Liam D Ferguson


    mellyw wrote: »
    Hi just looking for advice. my mam and dad are in their 60s and own their home. They are wondering if their is any way of releasing equity from their house that does not have to be paid back until the house has been sold or when they pass??? any advice appreciated.

    These Equity Release loans were popular at one time, but then the funding for them dried up around the time of the banking crisis. A few that I knew about were the Bank of Ireland Life Loan and Seniors Money. As far as I know, neither are offering money at the moment.

    I read a few months ago that AIB were thinking about getting back into this market but I don't know if they have done so. Might be worth a call to AIB.
    https://www.breakingnews.ie/business/equity-release-loans-for-older-people-included-in-new-aib-proposals-822914.html


  • #3
    coylemj
    Registered Users, Registered Users 2 Posts: 25,622 ✭✭✭✭coylemj


    mellyw wrote: »
    Hi just looking for advice. my mam and dad are in their 60s and own their home. They are wondering if their is any way of releasing equity from their house that does not have to be paid back until the house has been sold or when they pass??? any advice appreciated.

    They would have a aggregate/collective life expectancy of well over 20 years so I doubt if any lender would be interested. If they're not going to make any repayments then the deal would be that they take out a loan secured on the property, the interest rate is typically pretty severe and with accumulated interest, the outstanding balance wouldn't be long in swallowing up the capital (value of the house) long before the last of your parents passes away so it would not be an economic proposition.

    The risk for any prospective lender is that they have to sit it out for 20+ years following which your last surviving parent could pass away just in time for a crash in property prices.


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